diff --git a/src/lib/apply-shim.html b/src/lib/apply-shim.html
index 33caafff4a..3f3c5f6f0f 100644
--- a/src/lib/apply-shim.html
+++ b/src/lib/apply-shim.html
@@ -80,6 +80,7 @@
   // match var(--a, --b) to make var(--a, var(--b));
   var BAD_VAR = /var\(\s*(--[^,]*),\s*(--[^)]*)\)/g;
   var APPLY_NAME_CLEAN = /;\s*/m;
+  var INITIAL_INHERIT = /^\s*(initial)|(inherit)\s*$/;
 
   // separator used between mixin-name and mixin-property-name when producing properties
   // NOTE: plain '-' may cause collisions in user styles
@@ -102,10 +103,40 @@
     return mixinMap[name];
   }
 
+  var measureElement;
+  function getInitialValueForProperty(property) {
+    if (!measureElement) {
+      measureElement = document.createElement('meta');
+      measureElement.style.all = 'initial';
+      document.head.appendChild(measureElement);
+    }
+    return window.getComputedStyle(measureElement).getPropertyValue(property);
+  }
+
+  function replaceInitialOrInherit(property, value) {
+    var match = INITIAL_INHERIT.exec(value);
+    if (match) {
+      if (match[1]) {
+        // initial
+        // replace `initial` with the concrete initial value for this property
+        value = getInitialValueForProperty(property);
+      } else {
+        // inherit
+        // with this purposfully illegal value, the variable will be invalid at
+        // compute time (https://www.w3.org/TR/css-variables/#invalid-at-computed-value-time)
+        // and for inheriting values, will behave similarly
+        // we cannot support the same behavior for non inheriting values like 'border'
+        value = 'apply-shim-inherit';
+      }
+    }
+    return value;
+  }
+
   // "parse" a mixin definition into a map of properties and values
   // cssTextToMap('border: 2px solid black') -> ('border', '2px solid black')
   function cssTextToMap(text) {
     var props = text.split(';');
+    var property, value;
     var out = {};
     for (var i = 0, p, sp; i < props.length; i++) {
       p = props[i];
@@ -113,8 +144,10 @@
         sp = p.split(':');
         // ignore lines that aren't definitions like @media
         if (sp.length > 1) {
+          property = sp[0].trim();
           // some properties may have ':' in the value, like data urls
-          out[sp[0].trim()] = sp.slice(1).join(':');
+          value = replaceInitialOrInherit(property, sp.slice(1).join(':'));
+          out[property] = value;
         }
       }
     }
diff --git a/test/unit/styling-cross-scope-apply.html b/test/unit/styling-cross-scope-apply.html
index 615153e173..3ce6f97eff 100644
--- a/test/unit/styling-cross-scope-apply.html
+++ b/test/unit/styling-cross-scope-apply.html
@@ -591,6 +591,71 @@
   </script>
 </dom-module>
 
+<dom-module id="x-apply">
+  <template>
+    <style>
+    :host {
+      color: rgb(255, 0, 0);
+      border: 1px solid black;
+      @apply --initial-inherit;
+    }
+    </style>
+  </template>
+  <script>
+  HTMLImports.whenReady(function() {
+    Polymer({
+      is: 'x-apply'
+    })
+  });
+  </script>
+</dom-module>
+
+<dom-module id="x-initial">
+  <template>
+    <style>
+    :host {
+      --initial-inherit: {
+        color: initial;
+        border: initial;
+      };
+      color: rgb(0, 255, 0);
+      border: 2px solid blue;
+    }
+    </style>
+    <x-apply id="child"></x-apply>
+  </template>
+  <script>
+  HTMLImports.whenReady(function() {
+    Polymer({
+      is: 'x-initial'
+    })
+  });
+  </script>
+</dom-module>
+
+<dom-module id="x-inherit">
+  <template>
+    <style>
+    :host {
+      --initial-inherit: {
+        color: inherit;
+        border: inherit;
+      };
+      color: rgb(0, 255, 0);
+      border: 2px solid blue;
+    }
+    </style>
+    <x-apply id="child"></x-apply>
+  </template>
+  <script>
+  HTMLImports.whenReady(function() {
+    Polymer({
+      is: 'x-inherit'
+    })
+  });
+  </script>
+</dom-module>
+
 <script>
 suite('scoped-styling-apply', function() {
   function assertComputed(element, value, property) {
@@ -811,6 +876,29 @@
     CustomElements.takeRecords();
     assertComputed(e, '20px');
   });
+
+  test('Mixins can set "inherit" for a property', function() {
+    var e = document.createElement('x-inherit');
+    document.body.appendChild(e);
+    CustomElements.takeRecords();
+    assertComputed(e.$.child, 'rgb(0, 255, 0)', 'color');
+    if (!Polymer.Settings.useNativeCSSProperties) {
+      assertComputed(e.$.child, '2px');
+    } else {
+      // this is not supported for the apply shim
+      assert.throws(function() {
+        assertComputed(e.$.child, '2px');
+      })
+    }
+  });
+
+  test('Mixins can set "initial" for a property', function() {
+    var e = document.createElement('x-initial');
+    document.body.appendChild(e);
+    CustomElements.takeRecords();
+    assertComputed(e.$.child, 'rgb(0, 0, 0)', 'color');
+    assertComputed(e.$.child, '0px');
+  });
 });
 
 </script>